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Missed Opportunities

I recently read a speech by the former Administrator of the OMB Office of Information and Regulatory Affairs about the President’s directives on government regulation. He emphasized the importance of five key points regarding the regulatory look back and regulatory analysis in general:

public participation,

advance consultation,

simplification and harmonization,

quantification of benefits to justify costs, and

flexibility.

We have missed a huge opportunity to thoroughly analyze and quantify the effectiveness of our OTI regulatory program in reducing harm to the shipping public.

Real Harm Ignored

Again and again, the commercial OTI industry has pointed out that the real harm to the shipping public lies within the household goods segment of the intermediary industry. Inexplicably, we fail to address it. Instead, we focus on our own internal compliance problems and impose new regulatory renewal requirements on the entire OTI industry.

Although this proposed rule does extend the renewal requirement from 2 to 3 years, there is still little additional justification for a new renewal requirement. The proposed rule does not address the industry’s strong objections to a new license renewal requirement contained in their comments on the Advanced Notice of Proposed Rulemaking.

If the Commission staff’s calculations are accurate, the livelihoods of hundreds of small businesses may be at risk, not because they willfully failed to comply with the Shipping Act, but because they failed to renew their licenses. This assumes that we have the legislative authority to create a license renewal requirement. Our industry commenters on the ANPR do not think we have the authority, and I agree with them.

Additional Problems

Our brief Regulatory Flexibility "Certification" does not contain enough information for the public to comment on whether it is justified, despite our admission that 97 percent of the businesses in the OTI industry qualify as small businesses. The Proposed Rule attempts to establish a new licensing requirement for OTI’s that "hold out" or "advertise". The only licensing requirement in the Shipping Act for OTI’s is contained in section 19 and affects persons who "act" as an Ocean Transportation Intermediary.

The Commission reached a consensus on how to deal with OTI’s—predominately household goods movers—who advertise services without a license at our February, 2012, Commission meeting. Unfortunately, that consensus is not contained in this proposal.

Finally, and unfortunately, the streamlined license revocation process fails to respond to the worthwhile objections of our ANPRM commenters, and reinforces the appearance that the Commission is more concerned with internal regulatory challenges than with evaluating and responding to actual harm in the marketplace. Although there is one proposal in this package that I support because it would reduce the burden on the OTI industry, on balance, I oppose this proposed rule.